What is the revenue and EPS growth rate for NETGEAR year over year?

What were the key takeaways from NETGEAR’s earnings call?

What does NETGEAR do and what are its main business segments?

What were the key takeaways from NETGEAR's earnings call?

What guidance did NETGEAR's management provide for the next earnings period?

What is NETGEAR's gross profit margin?

What is the market's earnings forecast for NETGEAR next quarter?

What factors drove the changes in NETGEAR's revenue and profit?

- **Record Profitability**: Achieved non-GAAP profitability for the year, with Q3 EPS of $0.12 and 39.6% gross margin.
- **Enterprise Growth**: Enterprise segment revenue up 15.7% YoY, driven by ProAV switches and new security solutions.
- **Supply Chain Challenges**: Q4 gross margin headwind of 150bps from DDR4 memory costs, despite strong demand.
- **Strategic Momentum**: Launch of unified security platform, rebranding to NETGEAR Enterprise, and $20M share buybacks.
- **Government Impact**: Regulatory actions against TP-Link creating opportunities for NETGEAR in government and enterprise markets.

**【Management Opening Remarks】**
- Erik Bylin welcomed participants and outlined the call structure: CEO commentary, CFO financial review, and Q&A. He emphasized forward-looking statements and non-GAAP financial measures.

**【CEO Summary Section】**
- **Revenue and Profitability**: Sixth consecutive quarter exceeding revenue and non-GAAP operating margin guidance. Achieved non-GAAP profitability for the year, with Q3 non-GAAP EPS of $0.12.
- **Segment Performance**: Enterprise segment grew 16% YoY, driven by ProAV managed switches. Home Networking saw 8% sequential growth, and Mobile achieved record 31% non-GAAP gross margin.
- **Strategic Initiatives**: Launched new website and rebranded commercial business as NETGEAR Enterprise. Introduced unified security solution for SMEs, combining SASE and firewall capabilities.
- **Operational Efficiency**: Repurchased $20M in shares, reducing dilution. Streamlined operations and in-sourcing software development in Chennai.

**【CFO Financial Commentary】**
- **Q3 Financials**: Revenue $184.6M (8.2% sequential growth), non-GAAP gross margin 39.6% (record high). Enterprise segment revenue $90.8M (15.7% YoY), Home Networking $72.6M (down 6.6% YoY), Mobile $21.1M (down 20.7% YoY).
- **Margins and Expenses**: Non-GAAP operating income $3.8M (2.1% margin). Operating expenses $69.2M (25.1% YoY growth due to HQ move and hiring). R&D 11.7% of revenue.
- **Q4 Guidance**: Revenue $170M-$185M, GAAP operating margin -7.3% to -4.3%, non-GAAP -2% to 1%. Headwind of 150bps from DDR4 memory costs.
- **Cash and Capital Allocation**: $326.4M cash, $20M share buybacks. Annual recurring revenue (ARR) $37.9M (17.2% YoY growth).

**【Q&A Highlights】**
- **Gross Margin Headwinds**: DDR4 memory supply constraints impacting all segments, particularly Home Networking. Q4 gross margin expected to decline 150bps.
- **Revenue Guidance Factors**: Supply chain improvements for ProAV switches, holiday season Home Networking demand, and new product launches.
- **TP-Link Developments**: Increased customer interest due to regulatory scrutiny, with potential government actions impacting market dynamics.
- **Channel Strategy**: Launching new partner program with enhanced portal and support, targeting seamless channel engagement.
- **2026 Outlook**: Seasonal consumer business decline (mid-teens Q1), but confident in long-term profitable growth through enterprise expansion and software monetization.

NTGR

NTGR fundamentals

You can ask Aime